Denis Naughten (Roscommon-South Leitrim, Independent)
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To ask the Minister for Finance the steps being taken to regulate food securities trading on the stock market; and if he will make a statement on the matter. [42245/12]

Michael Noonan (Limerick City, Fine Gael)
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As outlined to the Deputy previously, food securities trading forms part of the regulation of derivatives. These can be divided into OTC (over-the-counter) derivatives and derivatives traded on exchanges. The regulation of both types of derivatives features in formal proposals by the EU Commission. OTC derivatives are now regulated by the European Markets Infrastructure Regulation (EMIR). This EU Regulation, which is directly applicable in all Member States, entered into force on 16 August 2012.

In relation to derivatives traded on exchanges, the existing regulatory regime which comes from the 2004 EU Markets in Financial Instruments Directive (MiFID) is currently being reviewed at EU level. The negotiations on the MiFID review (‘MiFID 2’ and ‘MiFIR’) are still underway in the Council of the EU and the European Parliament. The trading of derivatives is part of this agenda.

EMIR and MiFID 2/MiFIR are expected to result in a tighter regime for all derivatives, including food securities, whether traded OTC or through exchanges. The measures are intended to keep pace with trends in derivatives trading, and in line with G20 commitments. When finalised, these EU legislative initiatives will come into force in all Member States.

The Central Bank of Ireland is the competent authority in this country for the purposes of derivatives legislation.